Siemens to double sales in China in 5 years
By Richard McGregor in Shanghai
Published: May 17 2004 10:07 | Last Updated: May 17 2004 10:07
Siemens, the German industrial group, unveiled aggressive targets for its fast-growing China business on Monday, pledging to double sales within five years and its share of the local mobile phone market within three years.
The targets would be backed by new investment of about €1b in China in the next three to five years, Siemens said.
Dr Heinrich von Pierer, chief executive of Siemens, expressed confidence in the near-term future of the Chinese economy and said he did not expect the company's plans to be derailed by Beijing's efforts to slow growth.
"So far, I think things are under control," said Mr von Pierer, speaking in Shanghai at conference celebrating the 100th anniversary of Siemens's establishment in China.
Siemens aims to lift its expected sales from €4bn this year to €8bn by 2009 at the latest, an amount equal to about 10 per cent of the German company's present global revenues, up from 5 per cent in 2004.
The growth will come from the company's core businesses including power generation, medical equipment, auto making, transport equipment, mobile phones and information technology.
The company's mobile phone plant in Shanghai will lift output to 20m units a year from 14m currently, with the aim of selling more in China, the world's biggest handset market. Siemens now has a 4-5 per cent of the market.
Mr von Pierer said the partnership with Ningbo Bird, a Chinese handset maker, would allow it to use the Chinese company's 30,000 stores nationwide to sell its phones.
"Bird is not an exit strategy (from manufacturing)," he said, rebuffing suggestions that Siemens would eventually contact its manufacturing to the Chinese company, based at Ningbo, south of Shanghai.
Another target is to treble the value of procurement in China for Siemens global businesses to €5b by next year.
Mr von Pierer said Siemens had confidence in the pledge by Wen Jiabao, China's premier, during his trip to Europe last week.that China's leaders were committed to protect the intellectual property of foreign companies.
Foreign investors, and more recently local companies which have developed their own products, have struggled, often in vain, to protect their technology and brands in China from piracy.
Mr von Pierer says that Mr Wen's appointment of Wu Yi, a former health minister and trade negotiator, to police this issue was encouraging. "She has a very good international reputation," he said.
Siemens has about 45 companies and joint ventures in China, of which it says about 40 are either profitable or on the way to being so, and nearly 30,000 employees. |
